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today the producer price index actually fell when food and energy are excluded... not that we dont need to eat or drive our cars but its all the other things that act as a counter balance. like i said earlier the prices of most commodities have only a small effect on the overall price of finished goods . we dont have to worry about inflation until all the other things rise as well as our incomes....
now its a case of if more money goes for x then we cant buy y. theres more danger of a slow down and deflation then inflation at this stage.
today the producer price index actually fell when food and energy are excluded... not that we dont need to eat or drive our cars but its all the other things that act as a counter balance.
"Core inflation" is the number to look at, food and energy prices are very volatile. I'm not sure why people have trouble understanding this, after all oil was just $140/barrel 2 years ago and now its $84/barrel.
But in terms of food, I found this interesting:
"In comparison, the American Farm Bureau said the average national cost of Thanksgiving dinner this year is $43.47, a 56-cent price increase from last year. The survey was first conducted in 1986 and is intended to be an informal gauge of price trends around the nation"
Uh oh, cue someone who is at least 20 years older than me rolling in here saying that when they were young way more people could afford Thanksgiving dinner, even hobos riding trains were given full turkey dinners, plus everyone ate fresh turkeys none of this frozen stuff and neighbors who had canned cranberries would share with everyone you just don't see that anymore.
Uh oh, cue someone who is at least 20 years older than me rolling in here saying that when they were young way more people could afford Thanksgiving dinner, even hobos riding trains were given full turkey dinners, plus everyone ate fresh turkeys none of this frozen stuff and neighbors who had canned cranberries would share with everyone you just don't see that anymore.
Nah..they just showed up at the Salvation Army at 6:00 and waited in line with everyone else ....
I was directed to the You Tube computer animated analysis of Quantative Easing when Fox News did a piece on it yesterday. Ye Gods, this makes Berny Madoff look like a purse snatcher. The Fed, Ben Bernanke, Goldman Sachs, looters on a global scale.
Read the posts on it and you'll walk away with no doubt just who owns Barrack Obama. Bush was bad, Obama is worse and is completely under their thumb and I have little doubt he's going to be the fall guy when our economy implodes.
"Core inflation" is the number to look at, food and energy prices are very volatile. I'm not sure why people have trouble understanding this, after all oil was just $140/barrel 2 years ago and now its $84/barrel.
But in terms of food, I found this interesting:
"In comparison, the American Farm Bureau said the average national cost of Thanksgiving dinner this year is $43.47, a 56-cent price increase from last year. The survey was first conducted in 1986 and is intended to be an informal gauge of price trends around the nation"
your right, thats the key, its NOT being done under normal conditions hense everyone maybe jumping the gun as to how bad this is.
if they can suck just the right amount of money back out as we get healthier it could very well work. its much to early in the game for anyone to know what the end result will be.
When has the fed ever sucked money out of the economy actually. Besides Volcker?
Simply put you cannot suck it out once it is in the market geez.
money itself is debt. Only way to pay it is by going into more debt meaning more devaluation or inflation.
the deflate that means crash. that's only if we were on a gold standard though but because it is not that means inflation print away. Well I will say this again the problem is fractional reserve banking as well as fiat money.
No need to borrow money is best. Banks are a scam, debt is a scam.
short term gain for long term pain pretty much sums up debt.
Also about food prices being volatile. Ahem prices of orange juice/wheat/rice/sugar is up from 2 years ago by 20-50% so it is not just about bad harvests. It's also because currency is devalued.
If production does not offset the inflation what you get is rising prices that is what is happening in china and here and they are trying to slow inflation as well now. while we are trying to inflate.
If production = same but inflation up then you get rising prices.
"A government monetary policy occasionally used to increase the money supply by buying government securities or other securities from the market. Quantitative easing increases the money supply by flooding financial institutions with capital in an effort to promote increased lending and liquidity."
If this was done in a normal economy it would be inflationary, but this is a deflationary economy and as a result it will help stimulate the economy.
I suspect that it won't actually stimulate the economy. There may have been enough deflation in asset values to absorb this QE without significant price inflation at this time, but simply increasing the money supply is not a guarantee of greater economic activity.
but simply increasing the money supply is not a guarantee of greater economic activity.
Nothing is guaranteed, I don't think anybody in the FED thinks this is going to have a dramatic impact on the economy, just that its likely to help. At this point the FED is the only organization that can actually do anything, good or bad. Congress is already deadlocked.
we will have to meet back here in a few years to see if we have to do our complaining. so far im loving all this QE stuff as inflation is still running at a normal pace and my investments are all looking great as assets get a little reflation..
numbers coming in are getting better on all the reports monthly and eventually the last two to be helped should be unemployment and housing but they are still aways off as they are the last to improve traditionally.
we are all assuming this is going to turn out a bad thing but we dont know that yet do we?
My God man, even in the collapse of Rome there were some who felt truly delivered from the negative fallout, you know, all that Chinese proverbial stuff about great opportunity in times of great calamity. Millions of our countrymen are now facing a future of economic destitution and I think most here on this forum are making an attempt to address these folks concerns ( AKA the big picture), I'm thrilled that you have escaped the worst of the effects of QE but I'm convinced that many won't be partying over the news of your financial well being....
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